Corporate stock in a liquidation bankruptcy is ultimately worthless, since it represents ownership in a company with no assets that no longer functions as a going concern.
A Chapter 11 bankruptcy, as opposed to a Chapter 7 bankruptcy, does not always result in the liquidation of stock, since the company ultimately emerges from bankruptcy after reorganizing its debt.
However, even in Chapter 11 bankruptcy, most stocks end up worthless.
The best way for a stock to get liquidated, in most investors' eyes, would be when a stock is bought out.
On an individual basis, your personal stock may be subject to liquidation if you bought it on margin.
Margin is the process of borrowing money from a firm to purchase stock or other securities.
"Stock liquidation" can have a number of different meanings, but the common theme is that the stock is sold in exchange for money.
After receiving a Bachelor of Arts in English from UCLA, John Csiszar earned a Certified Financial Planner designation and served 18 years as an investment adviser.If you buy stocks on margin, your firm can liquidate your stocks if the equity in your account falls too much.As an individual, you can liquidate stock by selling it in your portfolio.In the parlance of the industry, liquidating a stock is simply selling it.
If you call your broker and tell him you want to liquidate a stock you own, he will enter a sell order for you.
At the time of your initial purchase, you must meet the initial maintenance requirement of 50 percent equity, meaning if you buy ,000 in stock you must put up at least ,000 yourself.